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Morning Brief: Albertsons to buy rest of Rite Aid in $24B deal

What to watch today

In the week ahead, a more quiet economic schedule faces investors after a run of inflation readings this past week pointed to higher prices coming to the U.S. economy. The U.S. markets were closed on Monday in observation of the President’s Day holiday, bringing investors a shortened week after what have been three-straight volatile weeks of market action after a placid 2017.

Fourth quarter earnings season is winding down, but a couple of premier reports are expected on Tuesday morning as both Walmart (WMT) and Home Depot (HD) will report results.

Albertsons will buy chunk of Rite Aid: U.S. grocery chain operator Albertsons Companies Inc. plans to buy the part of Rite Aid Corp. (RAD) that is not being bought by Walgreens Boots Alliance Inc. (WBA), the Wall Street Journal reported on Tuesday. The drug store operator and Albertsons together are valued at around $24 billion, including debt, WSJ said. If the deal goes through, the agreement would create a company with revenue of $83 billion. [Reuters]

Sony to form alliance to build taxi-hailing system: Sony Corp. (SNE) said on Tuesday it would become the latest blue-chip firm to jockey for position in Japan’s taxi and ride-hailing market, with plans for a joint venture to develop an artificial intelligence-based hailing system. The partnership is the latest in a growing array of tie-ups between domestic taxi firms and tech companies, who see Japan as a potentially lucrative market but are prevented from offering ride-sharing services by stringent rules. [Reuters]

Morgan Stanley says stock slide was just appetizer for real deal: The U.S. stock market only had a taste of the potential damage from higher bond yields earlier this year, with the biggest test yet to come, according to Morgan Stanley. “Appetizer, not the main course,” is how the bank’s strategists described the correction of late January to early February. Although higher bond yields proved tough for equity investors to digest, the key metric of inflation-adjusted yields didn’t break out of their range for the past five years, they said in a note Monday. [Bloomberg]

Private trades in Spotify shares to play key role in upcoming debut: Spotify AB is counting on its surging private-market value to bolster the music-streaming service’s appeal to investors in an unorthodox public debut that could be the biggest since Snap Inc.’s $20 billion IPO last year. The listing, expected as soon as the end of March, isn’t an initial public offering. Instead, the Swedish company will simply float the shares on the New York Stock Exchange and let the market find a price, in what is known as a direct listing. [The Wall Street Journal]